* The European Union and the United States adopted broad economic sanctions against Russia on Tuesday to punish Moscow's unbending stance in the Ukraine conflict. (http://on.wsj.com/1klsySg)

* Members of Argentina's banking association, known as Adeba, are working on a last-minute plan to help the country avoid default, according to people familiar with the idea. The association's plan, which hasn't been completely hashed out among the banks, would entail buying the legal claim and paying off the holdout creditors who are suing Argentina in U.S. courts for full payment on bonds the country defaulted on in 2001. (http://on.wsj.com/1ppxMuZ)

* For months, U.S. President Barack Obama said there were limits to his power to protect people living illegally in the U.S. from deportation. Now, he is considering broad action to scale back deportations that could include work permits for millions of people, according to lawmakers and immigration advocates who have consulted with the White House. (http://on.wsj.com/1xwAdxe)

* Israeli forces pounded Hamas symbols of control and Gaza's only power plant in one of the heaviest bombardments in the three-week conflict, trying to raise pressure on the Islamist group to accept Israel's terms for a cease-fire. (http://on.wsj.com/UJEGje)

* A little-known U.S. telecom company has hit upon a creative strategy that could help the industry shield billions of dollars from tax collectors. In a development that caught Wall Street by surprise, Windstream Holdings Inc was cleared by the Internal Revenue Service to reclassify most of its copper and fiber-optic lines as real estate, which could enable it to cut millions of dollars from its annual tax bill. (http://on.wsj.com/1lbOMkc)

* Drug makers and researchers are increasingly concerned that online chatter could unravel the carefully built construct of the 'blind' clinical trial. (http://on.wsj.com/XcHfMP)

* The slow progress in Sprint's pursuit of T-Mobile is in part tied to the public nature of the deal. With all the details out, there isn't as much pressure to make an announcement. (http://on.wsj.com/1oIWU0G)

* Twitter Inc quieted its doubters, at least for now, over its ability to jump-start shrinking user growth in the shadow of larger rival Facebook Inc. The social media company posted strong results across the board. (http://on.wsj.com/1zrH3ah)

* New York's Department of Financial Services is pushing to install monitors inside the U.S. offices of Deutsche Bank AG and Barclays PLC as part of an investigation into possible manipulation in the foreign-exchange market. (http://on.wsj.com/1s0BInK)

* McDonald's Corp could be treated as a joint employer with its franchisees in labor complaints, according to a National Labor Relations Board legal determination that could have far reaching implications. (http://on.wsj.com/UJ2vb6)

* China confirmed it is investigating whether Microsoft Corp broke its antimonopoly laws, the latest sign of growing commercial and policy tensions between the U.S. and China that are roiling technology companies in both countries. (http://on.wsj.com/1klEvHD)

* FedEx Corp pleaded not guilty Tuesday in San Francisco federal court on 15 charges related to transporting painkillers and other prescription drugs that had been sold illegally. (http://on.wsj.com/1klFjfA)

FT

The Bank of England is set to unveil a tough new regime on Wednesday, aimed at stamping out misconduct in Britain's banking industry. The framework includes powers to claw back bonuses up to seven years after they have been paid and a new law that would see reckless bankers sent to jail.

Twitter's New York-listed shares jumped as much as 34 percent in after-hours trading after the online messaging service beat analysts' earnings expectations and reported accelerated user growth in the second quarter.

UBS agreed to pay 300 million euros ($402.27 million) to settle a probe by authorities in Bochum into whether it helped German clients evade taxes, as it reported better-than-expected quarterly results.

Pfizer said it was still interested in deals that would allow it to put offshore revenues beyond the reach of the U.S. taxman as it called for the "fundamental reform" of its domestic tax system.

A top U.S. labour regulator has accused McDonald's of being jointly responsible for working conditions at its franchisees' restaurants, a decision that could deal a blow to the long-running fast food franchise model.

NYT

* Barring a last-minute deal, Argentina will default on billions of dollars of bonds on Wednesday. It would be Argentina's second default in 13 years. A default has been in the making since a group of New York hedge funds gained significant victories in American courts, where they are demanding that Argentina should pay them in full on government bonds that defaulted in 2001. (http://nyti.ms/1tYjH9c)

* The United States and Europe kicked off a joint effort on Tuesday intended to curb Russia's long-term ability to develop new oil resources, taking aim at the Kremlin's premier source of wealth and power in retaliation for its intervention in Ukraine. The goal was not to inhibit current oil production but to cloud Russia's energy future. (http://nyti.ms/1rBMLBL)

* The general counsel of the National Labor Relations Board ruled that McDonald's Corp could be held jointly liable for labor and wage violations by its franchise operators. The ruling comes after the labor board's legal team investigated myriad complaints that fast-food workers brought in the last 20 months, accusing McDonald's and its franchisees of unfair labor practices. (http://nyti.ms/1nEK6Z1)

* After New York proposed the virtual currency regulations two weeks ago, bitcoin enthusiasts have had a mixed reaction on whether the new rules will help legitimize the virtual currency or whether they will thwart innovation and threaten the very freedom that bitcoin was meant to promote. (http://nyti.ms/1pDxAWj)

* Lawmakers in Washington ratcheted up the pressure on Tuesday on companies seeking tax relief by moving overseas, introducing a bill that would withhold government contracts from companies that undertake so-called inversion deals. (http://nyti.ms/1n1bj39)

* Swiss bank UBS AG and Deutsche Bank AG of Germany became the latest banks to disclose that they were facing inquiries from regulators after Attorney General Eric Schneiderman of New York sued the British bank Barclays PLC last month over its private stock trading platform, known as a dark pool. (http://nyti.ms/1pDyhyL)

* The boutique investment bank Qatalyst Partners, which was hired by Trulia Inc three years ago, will also receive the reward of Trulia's sale to Zillow Inc. Qatalyst was unable to strike a deal three years ago and ultimately watched JPMorgan Chase & Co advise Trulia on its IPO. Qatalyst said that its old contract with Trulia was still valid and the fee now paid will be split between Qatalyst and JPMorgan. (http://nyti.ms/1n1dzXY)

* IAC/InterActive Corp said its online tutoring unit, Tutor.com, would buy the Princeton Review, whose test preparation guides are familiar to students studying for the SAT and other standardized tests, from Charles bank Capital Partners, a private equity firm based in Boston. The terms were not disclosed. (http://nyti.ms/1lUkzXb)

* Steven Cohen's renamed firm, Point72 Asset Management, which manages $9 billion to $10 billion of his personal fortune, is proving to be nearly as profitable as his former hedge fund. Over the first six months of this year, the firm generated a profit of nearly $1 billion. (http://nyti.ms/1nGjAP1)

* Twitter Inc reported strong growth in the second quarter, driven in part by heavy use of the service by soccer fans around the world during the month long FIFA World Cup, which spanned June and July. Twitter's results far exceeded Wall Street's expectations, and the company's shares rose about 29 percent in after-hours trading. (http://nyti.ms/1pDvfum)

* Oracle Corp kicked off its new cloud computing technology center in Seattle on Tuesday. On hand were several recruiting executives; initially designed for 100 cloud engineers, the facility is expected to hire a lot more and serve as an education and training facility as well. (http://nyti.ms/1k6nq3V)

Canada

THE GLOBE AND MAIL

* The owners of a sawmill that exploded in Prince George, British Columbia, two years ago, killing two workers, have been fined more than C$700,000 by the workplace safety agency. (http://bit.ly/1lcjTMG)

* An international effort to build an enormous telescope in Hawaii has taken an important step forward, a signal that the Canadian government will have to decide soon if Canadian astronomers will have a share in the instrument's future discoveries. (http://bit.ly/WMNOG1)

Reports in the business section:

* Penn West Petroleum Ltd, one of Canada's largest energy companies, has unveiled details of accounting irregularities and launched a review of its financial statements dating back four-and-a-half years. The company said it has notified securities regulators in Canada and the United States about the issues, which include some entries that reduce expenses. (http://bit.ly/1pEjDHJ)

NATIONAL POST

* The Canadian military is looking for an air defence system to protect its VIP aircraft, including the one used by Canadian Prime Minister Stephen Harper, from surface to air missiles. And one of Israel's top defence contractors, Elbit Systems Ltd , has been working behind-the-scenes for months to get in on the anticipated project. (http://bit.ly/1km1UbH)

* The Canadian military had to send its fledgling fighter pilots to the United States because of continuing problems with training, including several plane crashes, according to documents obtained by Postmedia News. (http://bit.ly/1AxJ0n7)

FINANCIAL POST

* TransCanada Corp expects to file an application for its massive Energy East project as early as next month. Touted as one of North America's largest energy projects at C$12 billion, the proposed conduit will find a new outlet for Alberta's landlocked crude as Canadian pipelines heading south to the U.S. and to the Canadian west coast are facing strong opposition. (http://bit.ly/1qKjyZe)

* Exxon Mobil Corp is assessing a floating liquefied natural gas apparatus on Canada's west coast that could see up to six barges moored in a narrow inlet north of Prince Rupert in British Columbia. (http://bit.ly/1lVIDJf)

China

CHINA SECURITIES JOURNAL

- China has drafted standards for crude oil delivery and inspection to prepare for the launch of crude oil futures trading in Shanghai.

SECURITIES TIMES

- China is preparing a new manufacturing industry plan, said Li Dong, Deputy Director of the Equipment Department of the Ministry in a summit on Tuesday. The plan is expected next year, said the newspaper.

- Wenzhou, a southern Chinese city, has removed eligibility criteria for home buyers, said Wenzhou Municipal Commission of Housing and Urban-Rural Development in a conference on Tuesday.

CHINA DAILY

- Nearly a quarter of employers in China are experiencing hiring difficulties, according to a survey conducted by Manpower Group Inc. Those skilled in trades, such as electricians, and sales representatives are the hardest to find.

SHANGHAI DAILY

- Li Daqiu, a former senior political adviser, has been charged with taking bribes, said China's highest court on Tuesday. Li was the vice chairman of the Guangxi political advisory body from 2003.

Britain

The Times

TULLETT WIELDS THE AXE AS CALM RETURNS

Tullett Prebon is to cut almost 10 percent of its staff as the interdealer broker reels from a slowdown in trading. (http://thetim.es/1rNkE6j)

GUARDIAN CARE HOMES SET TO SUE LLOYDS IN LIBOR CASE

Guardian Care Homes, which was at the centre of a 40 million pound ($67.77 million) settlement with Barclays, is now preparing a new legal action against Lloyds Banking Group that will focus on the taxpayer-backed lender's involvement in rigging borrowing rates. (http://thetim.es/UAbkUM)

The Guardian

BANKERS BRACED FOR NEW UK REGULATORY SCHEME FROM BANK OF ENGLAND

Britain's bankers are braced for the introduction of a tough new regulatory regime to be outlined by the Bank of England on Wednesday, under which they will have to wait longer for their bonuses and could be deemed guilty until proven innocent. (http://bit.ly/1uEeAPq)

BP FEARS SANCTIONS OVER STAKE IN RUSSIAN OIL FIRM WILL HIT PROFITS

British oil and gas group BP has warned investors that its finances and corporate image could be hurt by western sanctions against Russia. (http://bit.ly/1k5Qpop)

VODAFONE CHAIRMAN PROMISES TO PROTECT CUSTOMERS' RIGHT TO PRIVACY

Vodafone's chairman, Gerard Kleisterlee, has promised to protect the right to privacy, saying the mobile network will engage with the UK government's review of how the intelligence agencies intercept and collect data on its customers. (http://bit.ly/1k5MJmH)

Iain Conn, the veteran BP executive, has been appointed as Centrica chief executive with a pay package worth up to 3.7 million pounds, the British Gas owner announced. (http://bit.ly/1nFDCc9)

MONARCH RESHUFFLES TOP TEAM AHEAD OF CASH INJECTION

Airline and tour operator Monarch has reshuffled its top team at a critical time as it searches for new investors to help it become a more serious contender in the low cost travel market. (http://bit.ly/1nRYBtx)

The Independent

ELECTRA REJECTS ED BRAMSON'S RESTRUCTURING PLAN

Private-equity group Electra has rejected an attack by activist investor Ed Bramson, who wants to sit on the company's board and launch a review of its strategy. (http://ind.pn/1ppjDOl)

Domestic economic reports scheduled for today include:ADP employment report for July at 8:15--consensus 235KFirst-estimate GDP growth for Q2 at 8:30--consensus 3.1%FOMC meeting announcement to be released at 14:00

ANALYST RESEARCH

Upgrades

Altisource Residential (RESI) upgraded to Outperform at Keefe BruyetteC.H. Robinson (CHRW) upgraded to Neutral from Underperform at BofA/MerrillFinancial Engines (FNGN) upgraded to Market Perform from Underperform at Raymond JamesFreescale (FSL) upgraded to Equal Weight from Underweight at Morgan StanleyIntercept (ICPT) upgraded to Buy from Neutral at NomuraInternap (INAP) upgraded to Outperform from Market Perform at CowenInvenSense (INVN) upgraded to Buy from Hold at AscendiantOshkosh (OSK) upgraded to Outperform from Neutral at RW BairdPrudential (PRU) upgraded to Buy from Hold at CanaccordRoadrunner (RRTS) upgraded to Outperform from Market Perform at Raymond JamesS&T Bancorp (STBA) upgraded to Neutral from Sell at GuggenheimSEI Investments (SEIC) upgraded to Outperform from Perform at OppenheimerTwitter (TWTR) upgraded to Buy from Fair Value at CRT CapitalTwitter (TWTR) upgraded to Buy from Neutral at BofA/MerrillTwitter (TWTR) upgraded to Market Perform from Underperform at CowenTwitter (TWTR) upgraded to Neutral from Sell at UBSUnited Continental (UAL) upgraded to Overweight from Neutral at JPMorganYRC Worldwide (YRCW) upgraded to Market Perform from Underperform at Raymond James

Downgrades

Aflac (AFL) downgraded to Sector Perform from Outperform at Scotia CapitalAlaska Air (ALK) downgraded to Neutral from Overweight at JPMorganAmerican Capital Agency (AGNC) downgraded to Neutral from Buy at UBSBrandywine Realty (BDN) downgraded to Hold from Buy at StifelCBS Outdoor (CBSO) downgraded to Equal Weight from Overweight at Morgan StanleyCablevision (CVC) downgraded to Sell from Neutral at CitigroupCarbonite (CARB) downgraded to Underperform from Neutral at BofA/MerrillDomtar (UFS) downgraded to Neutral from Buy at GoldmanEaton (ETN) downgraded to Neutral from Buy at GoldmanEaton (ETN) downgraded to Neutral from Overweight at JPMorganEnbridge (ENB) downgraded to Buy from Conviction Buy at GoldmanFirstEnergy (FE) downgraded to Sell from Neutral at UBSImpax (IPXL) downgraded to Hold from Buy at WallachBethLamar Advertising (LAMR) downgraded to Equal Weight from Overweight at Morgan StanleyMaxim Integrated (MXIM) downgraded to Underweight from Equal Weight at Morgan StanleyMerit Medical (MMSI) downgraded to Outperform from Strong Buy at Raymond JamesMichael Kors (KORS) downgraded to Neutral from Outperform at RW BairdNational Oilwell (NOV) downgraded to Hold from Buy at JefferiesPacific Sunwear (PSUN) downgraded to Neutral from Buy at B. RileyTwitter (TWTR) downgraded to Sell from Hold at Pivotal ResearchVerizon (VZ) downgraded to Neutral from Outperform at MacquarieWaddell & Reed (WDR) downgraded to Market Perform from Outperform at Keefe BruyetteWindstream (WIN) downgraded to Market Perform from Outperform at Raymond James

Initiations

Aerohive Networks (HIVE) initiated with an Outperform at Pacific CrestNetgear (NTGR) initiated with a Sector Perform at Pacific CrestNextEra Energy Partners (NEP) initiated with a Market Perform at Wells FargoRuckus Wireless (RKUS) initiated with an Outperform at Pacific Crest

COMPANY NEWS

Amgen (AMGN) said it will reduce global workforce by 12%-15%, or 2,400-2,900 employees, beginning later this yearIcahn reduced stake in Family Dollar (FDO) to 6.03% from 9.39%, citing 'better' return potential elsewhereTwitter (TWTR) reported Q2 Average Monthly Active Users 271MRadioShack (RSH) may run through liquidity in 2015, Moody's saidAmazon (AMZN) called on Hachette to lower e-book pricesAstraZeneca (AZN) has entered an agreement to transfer to the company the rights to Almirall’s respiratory franchise for an initial consideration of $875M on completion, and up to $1.22B in development, launch, and sales-related milestonesTwitter (TWTR) acquired MadbitsDreamWorks Animation (DWA) said SEC investigating 'Turbo' writedown